Japanese Yen: USD/JPY (JPY=X) – US Dollar Pulls Back Against Japanese Yen After G7 Disappoints
The US dollar has pulled back a bit during the trading session after initially trying to rally above the 200 day EMA. The G7 had a conference call that ended up being a very disappointing event, as the G7 suggested that they were “watching closely” the markets. Ultimately, I believe that the market had hoped that there was going to be a statement that central banks around the world were going to do a coordinated move to liquefy the markets and perhaps even step in and buy certain things.
That being the case, the market looks likely to continue to go back into a “risk off” type of environment, and if we break down below the bottom of the Monday session, it’s likely that the pair drops down to the ¥105 level given enough time. I think that rallies at this point will continue to sell off, as the 200 day EMA is crucial and of course the 50 day EMA above would cause resistance as well.
In short, I believe that this is essentially a market that is a “fading the rallies” type of situation and the Japanese yen of course will be favored as one of the world’s premier safety currencies. We have recently seen the ¥110 level act as a magnet for price, but that’s not a huge surprise considering that we have a larger consolidation area between the ¥105 level on the bottom and the ¥115 level on the top. At this point, I do think that we are going to see continued pressure to the downside.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 109.25.
The projected upper bound is: 108.55.
The projected lower bound is: 105.58.
The projected closing price is: 107.07.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 22 white candles and 26 black candles for a net of 4 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 14.9780. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 7 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 31.94. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 8 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -154.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 7 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 4 period(s) ago.
Rex Takasugi – TD Profile
FOREX JPY= closed down -0.010 at 107.110. Volume was 98% below average (consolidating) and Bollinger Bands were 155% wider than normal.
Open High Low Close Volume___
107.120 107.150 107.060 107.110 1,481
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 109.52 109.46 108.37
Volatility: 12 9 7
Volume: 112,006 86,221 87,870
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX JPY= is currently 1.2% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume out of JPY= (mildly bearish). Our trend forecasting oscillators are currently bearish on JPY= and have had this outlook for the last 3 periods.
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